What Is a Mortgage Recast?

A mortgage recast is a one-time recalculation of your monthly payment after you pay a large lump sum toward principal. The rate and the end date stay the same; the smaller balance is spread over the months you have left, so the payment falls.

Example: on $300,000 at 4.5% with 25 years left, a $50,000 lump sum takes the payment from $1,667.50 to $1,389.58.

How lenders describe it

  • Fannie Mae describes a recast as a re-amortization of the new outstanding balance over the remaining term.
  • Chase says a recast keeps your current interest rate and spreads the remaining balance over the remaining term.
  • PNC says a recast keeps your current interest rate and end date.

What changes and what stays

BeforeAfter the recast
Balance$300,000$250,000
Interest rate4.5%4.5%
Years left2525
Principal and interest payment$1,667.50$1,389.58
Saved each month-$277.92

The lump sum is not lost: it is equity in the house. The numbers come from the same formula as the mortgage recast calculator; the steps are in how to calculate a recast payment.

When a recast fits, and when it does not

  • It fits when you got a lump sum (a sale, a bonus, an inheritance) and want a lower required payment without a new loan.
  • It does not fit if you want a lower rate or a shorter term; those need a refinance or extra payments.
  • It may not be available: lenders set minimums, fees and loan types. See fees and rules by lender and what a recast costs.

Frequently asked questions

What is mortgage recasting in one sentence?

You pay a lump sum toward principal, and the servicer recalculates your payment on the smaller balance over the months you have left, at the same rate.

Does a recast lower my interest rate?

No. The rate does not change. If you want a new rate, that is a refinance. Compare the two in the recast vs refinance calculator.

Does a recast shorten the loan?

No. The end date stays the same. To end the loan sooner, keep paying your old amount after the lump sum. See recast vs extra principal payment.

Is a recast the same as an extra payment?

No. An extra payment lowers the balance but does not by itself change the payment your servicer requires. A recast is the step that lowers the required payment.

Do I have to recast?

No. It is a request to your servicer, and rules and fees vary. Read the fees and rules by lender first.

Sources

Every figure on this page comes from the pages below. Checked 2026-10-22. Rules change, so confirm with your own servicer.

More recast guides